Marketing as Backbeat at Indie Music Festival

That question was pondered and debated by fans, musicians and corporate sponsors alike at the annual South by Southwest music festival here, where logo-filled banners line the streets downtown, and a flier stapled to a telephone pole might be for an indie-rock showcase in a parking lot, a marketing experiment for a blue-chip soft drink company or both.

South by Southwest, which ended its 23rd installment on Sunday, is celebrated around the world as one of the great institutions of independent music, drawing record labels, bloggers, booking agents, filmmakers, radio programmers and anyone else in search of the next cool thing. As it has grown, so has its attraction to corporate America as a rare nexus of tastemakers, leading to saturation promotional tactics that strike many festivalgoers as excessive.

“I’m wary when I end up at events like ‘Smokin’ Music,’ ” said Kenneth Tan, a vacationing bookstore employee from New York, “where they offer me free packs of cigarettes and a pass to get into after-show parties for my phone number and e-mail so they can send me advertisements for future American Spirit promotions.”

Sponsors do more than just hand out samples and collect e-mail addresses. They provide the shadow financing that pays for much of what happens at South by Southwest, from the rent for off-site party spaces to artists’ lodging and travel expenses. For many bands the only substantial performance fee of the week might come from a sponsored party.

Marketers, promoters and artist managers say that a modest branded party at South by Southwest costs $10,000 or so, but that major events with top talent can easily cost hundreds of thousands of dollars. In return that talent is often publicly grateful for the sponsor’s largess. Kanye West made sure to give a shout-out to Levi’s in a performance at its Levi’s/Fader Fort party space on Saturday night.

Although the economy has forced many companies to trim their budgets, sponsorship and advertising were ubiquitous in downtown Austin. Giant balloons shaped like energy-drink cans bobbed in the wind on East Sixth Street, and nonmusic companies like PepsiCo, BlackBerry and National Public Radio have established a greater presence, as music magazines and record labels have scaled back.

“The core of the 18-to-34 demographic has not been as affected by the economy as the 30- to 40-year-olds,” said Jon Cohen of Cornerstone, a multifaceted marketing firm that organized the Levi’s/Fader Fort. “They have no mortgage, no kids. The brands that target those consumers have not been hit quite as hard.”

Photo

Mountain Dews Green Label Sound project tried the showcase treatment at the South by Southwest indie music festival.Credit
Josh Haner/The New York Times

For most sponsors, however, simply putting up signs and handing out samples is no longer very effective. This year PepsiCo, the beverage and snack conglomerate, was an official sponsor of South by Southwest, landing its logo on banners and program guides. But if that was the only exposure, it would be a waste, said Frank Cooper, PepsiCo’s vice president for portfolio brands.

“Having a name on a banner now, if that’s all you do, it’s become wallpaper,” he said. “We’re past the world where you can simply write a check. Now consumers ascribe value to those who create, and brands have to create.”

On Thursday night Mountain Dew, a PepsiCo brand, had a showcase for its Green Label Sound project, which releases music by hipster-approved acts like Matt & Kim and the Cool Kids. Held under a tent in a restaurant parking lot, the event resembled any unfancy party at South by Southwest. The performers included the Pains of Being Pure at Heart, a bouncy indie-pop band from New York that only hours earlier had played in a small bar a few blocks away.

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But for PepsiCo, which encouraged its employees to chat about the event on blogs, Facebook and Twitter, it was an important test of a new, immersive approach that, if successful, could be used for other big festivals like Coachella or Bonnaroo, Mr. Cooper said.

For many companies, though, the backlash has already begun. Scion, a Toyota brand that was a major presence at South by Southwest for the last four years, pulled out this year because the combined noise of so many competing sponsors was starting to drown out the music, said Jeri Yoshizu, Scion’s manager for sales promotions and a veteran of underground music sponsorship.

“The music was lost among the banners, the energy drinks and the guerrilla marketing happening all over the place,” she said. “It was a bummer. There was a disconnect between the music and the people who wished to hear it.”

Though attendance this year was about even with last year — about 12,000, a spokeswoman said — the economy this year seems to have squeezed fans, who have a knack for enjoying the fruits of sponsors’ generosity while blocking out their messages. The streets were just as crowded during the afternoons, when the clubs fill with free sponsored parties, as they were at night for the official showcases, when attendees need a badge that can cost up to $695.

At the Perez Hilton party late Saturday in an old Safeway store, the walls were covered with sponsor names — Alizé, Dos Equis, Dell — and the crowd included plenty of people who said that they appreciated what the companies make possible.

“It’s great,” said Amber Zook, 26, a landscape designer from Austin. “A few years ago you couldn’t do anything because the badges were so expensive. Now everything you want to go to is free.”

Melena Ryzik contributed reporting.

A version of this article appears in print on , on Page C5 of the New York edition with the headline: Marketing as Backbeat At Indie Music Festival. Order Reprints|Today's Paper|Subscribe